Topic: Everything in the red explained (Read 713 times)
They drop because the surge in their prices is nearly baseless and they are just getting pumped, they get into bubble and when it bursts everyone starts panic selling. Then at some point it stops when sellers start to think that they won't be getting any profits below that level. IMO, many alts are getting pumped seeing the surge in BTC itself and they have no other reasons to go and reach those highs because big players are trying to gain as much btc as they can while the price of BTC remains high.
Bitcoin is the cornerstone of the whole crypto market, the price of any altcoin is highly related to BTC.
There were also whales at play. Several of the alts had huge sell walls that kept being adjusted for low accumulation.
I still don't fully understand why all the alts drop so much, 30% 50% when bitcoin goes up $100. Who is doing the dumping, big investors or the herd of day traders? Sure these coins are traded against btc, so your coin is worth about the same in dollars, but it's not traded against dollars, it's just worth less bitcoin when it goes down. Does anyone really know why alts always do this? Are people expecting bitcoin to jump to $10 000 over night? I have heard that when bitcoin goes up there is more money injected into the system so alts go up as well, but they never do. When alts recover in a few days they bearly make back what they lost.
Several different motivations behind this trend but some of the main ones are that it's not just BTC that people are switching over to but ETH. When they see the big coins on a run they want to convert over to enjoy the profits. People also expect their alts to consolodate after a run up and they want their money to continue working for them so they get into another alt or back to BTC/ETH. Also, yes...plenty of new traders/investors that try to abandon ship when they see things in the red.
No one is expecting bitcoin to jump to $10000 overnight, I think its just become a trend so traders panic sell their alts and move into bitcoin until the recovery happens. But do remember that bitcoin still has the highest market cap so while it doesn't take much to move especially small alts by 30% or more the same increase in demand for bitcoin might move it by a tiny amount.
I still don't fully understand why all the alts drop so much, 30% 50% when bitcoin goes up $100. Who is doing the dumping, big investors or the herd of day traders? Sure these coins are traded against btc, so your coin is worth about the same in dollars, but it's not traded against dollars, it's just worth less bitcoin when it goes down. Does anyone really know why alts always do this? Are people expecting bitcoin to jump to $10 000 over night? I have heard that when bitcoin goes up there is more money injected into the system so alts go up as well, but they never do. When alts recover in a few days they bearly make back what they lost.
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